The Wholesale Electricity Market (WEM) for the South West Interconnected System of Western Australia (SWIS) commenced operation on 21 September 2006.

The WEM aims to facilitate competition and private investment, and allow generators and wholesale purchasers of electricity (such as retailers) greater flexibility as to how they sell or procure electricity, and who they transact with.

AEMO is responsible for operating the WEM in accordance with the Wholesale Electricity Market Rules (WEM Rules) and the related WEM Market Procedures.

Other entities that play a role in the oversight and administration of the WEM are:

The Minister for Energy, who established the initial WEM Rules, approves proposed changes to Protected Provisions in the Market Rules and has the ability to make amending rules;

The Economic Regulation Authority, which performs regulatory and market surveillance roles and monitors and enforces compliance with the WEM Rules;

The independent Rule Change Panel which undertakes the administration and decision-making functions for changes to the WEM Rules; and

The Electricity Review Board which acts as an adjudicator for appeals.

All relevant contact details for the WA Functions and the Western Australian Market Reform Program can be found in the WA Contact Card(72 KB, pdf).

WEM objectives

The WEM rules establish that the objectives of the WEM are to:

Promote the economically efficient, safe and reliable production and supply of electricity and electricity-related services in the SWIS.

Encourage competition among generators and retailers in the SWIS, including by facilitating efficient entry of new competitors.

Avoid discrimination in that market against particular energy options and technologies, including sustainable energy options and technologies such as those that make use of renewable resources or that reduce overall greenhouse gas emissions.

Minimise the long-term cost of electricity supplied to customers from the SWIS.

Encourage the taking of measures to manage the amount of electricity used and when it is used.

WEM Rules

The Rule Change Panel is responsible for the administration and decision-making functions for changes to the WEM Rules.

The following information regarding associated WEM Rule administration processes is available from the Rule Change Panel’s website:

WEM design

The WEM Rules, which establish the structure and processes that constitute the WEM, were developed by the Office of Energy (now known as the Public Utilities Office), with substantial support from a number of expert teams comprising industry and Government representatives.

The design for the WEM comprises a wholesale electricity trading component and a capacity component. The WEM Design Summary explains the design in detail.